Negotiations over proposed workers’ compensation insurance reform legislation continue but more business leaders — and Gov. John Hickenlooper — are beginning to ask if reform is needed in the first place.

Phil Hayes, political and legislative director for the Colorado AFL-CIO, said he is working on a second draft of a proposed law and believes that he will be able to address all of the concerns that came up after the first draft was unveiled early this month.

Last month, Rep. Angela Williams, D-Denver, announced her intentions to sponsor a workers' comp reform bill in the coming legislative session. Business groups indicated a willingness to sit down and hear the concerns of labor leaders and see if there is common ground on what can be changed.

But over the past week, as they answered Denver Business Journal questions about their biggest issues heading into the 2014 session, those same leaders routinely cited workers’ compensation reform as No. 1. But they also emphasized that the current system has left the state with some of the lowest premiums for workers' comp insurance in the country.

“I think our struggle is we’re still not clear what’s trying to be fixed,” said Kelly Brough, president/CEO of the Denver Metro Chamber of Commerce.

Added Mizraim Cordero, director of the Colorado Competitive Council: “We believe that there’s no real good reason to reform the system we have in place right now. We think it’s working well. If there are issues, they are sporadic.”

Hearing the rising skepticism, I took the opportunity to ask Hickenlooper his thoughts on the workers’ comp reform issue during a media availability he held Thursday afternoon.

Though the governor gave a typical willing-to-listen answer, what was interesting about his response was which side of the worker-business perspective he said he would be examining to determine how he felt — after explaining earlier that improving the small-business ecosystem in Colorado is his primary goal for the session.

“I haven’t seen any drafts yet. My first question is going to be: Is this going to help small businesses and in what ways is it going to help small businesses and what does that look like?” Hickenlooper said.

Labor leaders began pushing for reforms about a year ago, focusing on three areas. They want workers to be able to choose from between more than two employer-offered doctors to treat their injuries, including having the possibility of seeing family physicians with whom they have long-standing relationships.

They want to eliminate the 50 percent automatic reduction in the size of settlements for workers who broke safety codes while getting injured. And they want to find some way to reduce the amount of settlements that result in the employee being separated permanently from the company.

The first two of those conditions always have been expected to be flash points. Business leaders say limiting choice of doctors and safety code settlement limitations as key to keeping premiums down because it ensures that only physicians expert in workers’ comp cases treat injured employees and incentivizes workers to follow safety rules. But the amount of separation agreements is stirring opposition too.

Michael Gifford, executive director of the Associated General Contractors of Colorado, said he has heard concerns from members worried about a part of the bill that would prohibit them from terminating workers — even those unfit because of injuries to do the jobs they had before — without the consent of the worker. Construction companies nationwide already pay higher workers’ comp premiums than most other businesses.

“Our rates are some of the lowest in the country, so we know it works. We’re reluctant to change that,” Gifford said. “They’re willing to negotiate, though, so we’ll continue to talk.”

Hayes, however, said that what labor leaders are looking for is just a signed agreement before any settlement that states that both the worker and the company have OK’d the separation in exchange for benefits.

Right now, the Colorado Department of Labor and Employment has no statistics on how many workers’ comp settlements end in separation — some injury attorneys estimate it’s 95 percent — and this would allow the state to get actual figures before it determines if this trend should set off alarms, he said.

“The issue here for us is ... you’re saying it’s not a problem, we’re hearing it is,” Hayes said. “Let’s actually track data to see if it is.”

Also, there's another voice in the discussions in recent weeks: Phil Kalin, the new CEO of Pinnacol Assurance, the state-chartered workers’ compensation insurer that writes policies for 59 percent of Colorado businesses.

Kalin — hired partly because company officials believe he’ll be able to improve relationships with legislators of all stripes — started his job after Williams first said she wanted to oversee the reform effort.

Kalin told me he, too, has concerns.

“We are just looking at that [bill] language ... But the question we’re going to be asking, because clarity here is so important, is: What are we trying to fix?” Kalin said. “There’s nothing I’ve seen or heard to suggest that needs fixing. But that’s why we are in these early conversations.”

None of this precludes a compromise on any of labor’s three areas of concern. But it seems to indicate that businesses — empowered by what they believe is Hickenlooper’s backing on this issue — are unwilling to give away too much.

“None of those [concerns] have proven to be an issue,” said Tony Gagliardi, state director for the National Federation of Independent Business. “So, we see absolutely no reason for undoing a policy that’s made Colorado a leader on workers’ comp reform for the past 15 years.”

If they can’t convince lawmakers that changes are needed, AFL-CIO leaders believe that workers who have been hurt by the current restrictions in state law can.

“We have a good dialogue going ... There hasn’t been concern raised that we can’t take an attempt to solve,” he said. “But when you have this bill before the Legislature, you can bet there will be hundreds of workers testifying this is a problem.”

BUSINESS LEGISLATIVE PREVIEW, Jan. 7, 2014Ed Sealover will moderate a panel discussion on these and other issues featuring Senate President Morgan Carroll and Minority Leader Bill Cadman as well as House Speaker Mark Ferrandino and Minority Leader Brian DelGrosso. Location: History Colorado, 1200 Broadway, Denver. Click here for details.